Brown Advisory Student-Managed Investment Fund
Invest in your future. Join the Brown Advisory Student-Managed Fund (SMIF) and gain real-world investing experience.
The Brown Advisory Student-Managed Investment Fund Program offers a unique opportunity for students to develop and utilize their investment skills by providing real-life investing experience. Originally founded as the Alex. Brown Student-Managed Investment Fund and recently renamed to honor the fund’s founder’s firm, the program oversees a sizable student-managed fund invested in equities, and includes interaction with investment professionals and other activities.
Students have front-line responsibility for researching and recommending equity trades. The program includes extensive interaction with investment professionals and ongoing research and learning opportunities. The program goal is to help talented, motivated students learn about and prepare for careers in the investment field.
What would you do with a half million dollars?
As the students in the Brown Advisory Student-Managed Investment Fund know, the right answer is: “Invest.”
W. James Price IV, a former partner and managing director of Alex. Brown & Sons, senior advisor at Brown Advisory, and a member of the College’s Board of Visitors and Governors, funded the program to give Washington College’s business students an edge in launching careers in finance.
“When I finished college, I had no real-world knowledge of the investment world,” Price said. “When I started at Alex. Brown & Sons, I had great mentors but, as I look back, I always wished I had started with more knowledge of investments.”
Students accepted into the program research companies and industries for possible investment opportunities, meet regularly with finance professionals to discuss market developments, and make recommendations about what stocks to invest in.
That’s the rate of return students achieved last year, exceeding the NYSE overall rate of return.
Richard Bookbinder, Brown Advisory Student-Managed Investment Fund Senior Advisor, meets weekly with students to discuss news and developments affecting the portfolio. He manages TerraVerde Capital Management, a New York-based hedge fund for green investment. He tweets about green investing issues.
What We’re Reading
Beasley et al., Fraudulent Financial Reporting, 1998-2007
Mark Beasley et al., “Fraudulent Financial Reporting 1998-2007: An Analysis of U.S. Public Companies.” The study, commissioned by leading American accounting organizations, including the American Accounting Association, documents more than 300 cases of accounting fraud in American business during a decade that saw many high-profile instances of malfeasance, with a total misappropriation of more than $100 billion.
Senior leaders, according to the study, play a critical role in enabling fraud: 89% of CEOs and/or CFOs were named by the SEC in fraud cases it investigated.
The study concludes that the long-term impact of accounting and reporting fraud was strongly negative, with companies committing fraud facing higher-than-average risks of bankruptcy, delisting, or asset sales.
Belsky and Gilovich, Why Smart People Make Big Money Mistakes
Gary Belsky and Thomas Gilovich, Why Smart People Make Big Money Mistakes And How To Correct Them: Lessons From The New Science Of Behavioral Economics (Simon & Schuster, rev. ed. 2010).
In this entertaining and readable book, Belsky and Gilovich explore how people think about money and financial decisions, and why we sometimes make mistakes. Drawing on the rapidly advancing field of behavioral economics, they explore mistakes like the sunk cost fallacy, the tendency to throw good money after bad.
No matter how ‘smart’ you are, Belsky and Gilovich will help you avoid making irrational financial decisions.
Graham, The Intelligent Investor
Benjamin Graham, The Intelligent Investor (1949; revised in 2003 with commentary by Jason Zweig).
How can you make money in the stock market? In this classic book Benjamin Graham lays out his key idea: “value investing.” Warren Buffett, America’s most famous and revered billionaire investor, was inspired by Graham’s ideas, and called The Intelligent Investor “by far the best book on investing ever written.”
By focusing on fundamentals and resisting the urge to buy and sell at every market fluctuation, Graham argues, the intelligent investor can minimize risk and maximize long-term gain.
It worked for Warren Buffett and countless other investors in the six decades since Graham’s book first came out. It probably stil has some wisdom left for you.
Morgenson and Rosner, Reckless Endangerment
Gretchen Morgenson and Joshua Rosner, Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon (Times Books/Henry Holt, 2011).
A searing exposé of the financial collapse in America in the 2000s, a collapse that has had far-reaching consequences and has been likened to a second Great Depression.
Pulitzer-Prize-winning journal Morgenson and her co-author trace the roots of the collapse to an unhealthy, uncontrolled partnership between private-sector banks, mortgage giants Fannie Mae and Freddie Mac, and politicians going back to the 1990s. They paint a vivid story of how Fannie and Freddie, eager to guard their privileged position of being backed by the government, aggressively resisted Congressional oversight while showering money on politicians to win favorable treatment.
The authors reveal the workings of the revolving door between Washington and Wall Street, and note that in the years since the collapse, no individual has been held accountable for the ruin and suffering. It’s a powerful, astonishing story of immensely powerful individuals using their connections and positions to enrich themselves, while shielding themselves from the consequences of their mistakes.
Piketty, Capital in the Twenty-First Century
Thomas Piketty, Capital in the Twenty-First Century (Belknap, 2014).
In this best-selling work, French economist Thomas Piketty argues that the 21st century is seeing a return to ‘patrimonial capitalism,’ the concentration of wealth, income, and power in the hands of a small group of super-wealthy individuals and families.
Posner, God’s Bankers, A History of Money and Power at the Vatican
Gerald Posner, God’s Bankers: A History of Money and Power at the Vatican (Simon & Schuster, 2015).
Noted investigative journalist Gerald Posner explores the complex and Byzantine financial workings of the Roman Catholic Church over the past two centuries. “A fast-paced read that brings history alive on every page” (Booklist).
Sutton and Rao, Scaling Up Excellence
Sutton and Rao, Scaling Up Excellence: Getting to More Without Settling for Less (Crown Business, 2014).
Stanford professors Sutton and Rao explore how organizations can take good ideas practices—“pockets of exemplary performance”—and ‘scale’ them: expand their reach across the entire organization. Based on extensive research from many different industries, Sutton and Rao present a concise, clear framework for “spreading excellence” within a company.
Turner, Economics After the Crisis
Adair Turner, Economics After the Crisis (MIT Press, 2012).
The financial crisis of 2008 continues to roil the global economy. Turner, Britain’s chief financial regulator, argues that what is needed to restore sustained growth is a rethinking of the basic premises of economics and financial regulation.
For the last generation, Turner says, economic policymaking has been driven by the so-called Washington Consensus: that markets are efficient, that economic actors are rational in pursuit of their own self-interest, and that inequality is an inescapable consequence of the necessary pursuit of economic growth.
These simplifying assumptions certainly make for elegant mathematical models. But Turner argues that they simply don’t do a good job mapping the real world.
What are the consequences when the assumptions and the real world diverge? And what should we do now to rebuild the global economy? Turner’s book will inspire hard thinking about these big questions.